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Aug 03, 2024
Signet Q2 2025 Earnings Report
Delivered results in line with expectations, increased merchandise margin rate and average transaction value, and reiterated fiscal 2025 guidance.
Key Takeaways
Signet Jewelers reported Q2 Fiscal 2025 sales of $1.5 billion, a decrease of 7.6% compared to Q2 of FY24. Same store sales decreased by 3.4%. The company reported a diluted loss per share of $2.28, while adjusted diluted EPS was $1.25. They are increasing their cost savings target to $200 million for the year.
Sales of $1.5 billion, down 7.6% compared to Q2 of FY24.
Same store sales decreased 3.4% compared to Q2 of FY24.
Gross Margins expanded 10 basis points to 38.0% of sales.
Adjusted diluted EPS of $1.25, compared to $1.55 in Q2 of FY24.
Signet
Signet
Signet Revenue by Segment
Signet Revenue by Geographic Location
Revenue by Segment
North America Revenue
CapyFin.comInternational Revenue
CapyFin.comOther Revenue
CapyFin.comRevenue by Geographic Location
North America Revenue
CapyFin.comInternational Revenue
CapyFin.com Forward Guidance
Signet provided guidance for the third quarter and full year fiscal 2025. For the third quarter, they expect total sales of $1.345 billion to $1.380 billion and same store sales to be between -1.0% to +1.5%. For the full year, they expect total sales of $6.66 billion to $7.02 billion and same store sales to be between -4.5% to +0.5%.
Positive Outlook
- Engagements to increase by up to 5% in Fiscal 2025; however, Signet's guidance accommodates a range of engagements from (5%) to +5%. The Company's Q3 to-date engagement units are positive year on year.
- Fashion sales to be more robust based on recent trends and a modest improvement in the Digital Banners combine to offset the slower than expected engagement recovery.
- Up to $200 million in cost savings initiatives in Fiscal 2025, up from our previous expectations of $150 million to $180 million.
- Up to $1.1 billion allocated to retirement of debt, redemption of preferred shares and open-market common share repurchases in Fiscal 2025.
- The Company believes this facility will cover liquidity needs for the next 5 years at attractive terms, providing flexibility on capital priorities which include retiring the remainder of the convertible preferred shares.
Challenges Ahead
- Total sales $1.345 billion to $1.380 billion
- Same store sales(1.0%) to +1.5%
- Adjusted operating income $8 million to $25 million
- Adjusted EBITDA $55 million to $72 million
- Approximately $225 million in non-comparable sales headwinds reflecting over $100 million from the 53rd week in Fiscal 2024, approximately $75 million in the UK from the sale of previously announced prestige watch locations in the UK and up to 30 Ernest Jones store closures, and approximately $50 million from total store closures in North America in Fiscal 2024 and Fiscal 2025.
Revenue & Expenses
Visualization of income flow from segment revenue to net income